Elon Musk and AI Startup xAI are Suing Apple and OpenAI for Alleged Anticompetitive Practices

Elon Musk has initiated legal proceedings against Apple and OpenAI, alleging that their collaboration to integrate ChatGPT into the iPhone is hindering competition within the AI sector. The lawsuit, filed by Musk's X Corp. and xAI, also accuses Apple's App Store of sidelining competing chatbots and "super" apps like Grok and X.

Musk's companies assert that iPhone users are compelled to use ChatGPT as their default chatbot when activating Apple Intelligence, leaving them with little incentive to download alternative AI applications. They claim that Apple and OpenAI have monopolized markets to stifle competition from innovators such as X and xAI.

Why is Elon Musk Suing Apple and OpenAI?

Photo Credit: AI Generated

Allegations of Unfair Practices

Earlier this month, Musk threatened legal action against Apple, accusing it of manipulating App Store rankings in favor of OpenAI. He stated, "Apple is behaving in a manner that makes it impossible for any AI company besides OpenAI to reach #1 in the App Store, which is an unequivocal antitrust violation."

The lawsuit further contends that despite high rankings for the X and Grok apps, neither appears in the App Store's "Must-Have Apps" section. On August 24th, 2025, ChatGPT was reportedly the sole AI chatbot featured in this section.

Concerns Over Market Dominance

X and xAI also argue that Apple's partnership with OpenAI creates a protective barrier for the AI giant due to Apple's dominant position in smartphones. They highlight that integrating ChatGPT into iPhones grants OpenAI access to potentially billions of user prompts from millions of devices, allegedly providing it with an unfair edge.

An OpenAI spokesperson, Kayla Wood, responded to these claims by stating, "This latest filing is consistent with Mr Musk's ongoing pattern of harassment." Meanwhile, Apple previously informed Bloomberg that its store aims to be fair and unbiased.

These allegations underscore ongoing tensions between major tech players over market control and competitive practices. As this legal battle unfolds, it raises questions about how tech giants manage partnerships and competition within rapidly evolving industries.